The National Tornado Preparedness Summit in Oklahoma City – an event sponsored by the Oklahoma Insurance Department, the National Weather Center, and the National Association of Insurance Commissioners – is expected to draw almost 800 representatives from the insurance industry.
According to the Oklahoma Farm Bureau Insurance vice president of public affairs, John Wiscaver, the harsh reality for the state is that throughout the last five years, the marketplace has faced the highest historic loss levels among all organization histories. He stated that earthquakes, hailstorms, tornadoes, and wildfires have all left significant property damage behind in Oklahoma during that time.
Wiscaver went on to state that the results were devastating “in both in numbers of claims and the severity of those claims, which is really a key piece in trying to help manage homeowner’s insurance.” He explained that when both severity and frequency occur in large excess, this causes a notable challenge for the insurers.
In fact, some homeowners in Oklahoma have found that following multiple claims, their insurance companies will either decline to renew their coverage, or they will increase their rates, or offer them a more limited form of coverage. Some insurers have left the state altogether.
John D. Doak, the insurance commissioner for Oklahoma, said that regardless of the challenges being faced, the insurance industry there remains competitive and strong. He described his belief of the situation by saying that though there may be a few smaller carriers that insure a total of 500 or 1,000 homes in the entire state that are withdrawing, he’d rather do so sooner, while they remain financially strong, so that consumers will have a better opportunity to comparison shop and obtain better coverage that will last them into the future and won’t have to face a small bankrupted insurer.
